How JustAnswer Works:
  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.
Ask Lane Your Own Question
Lane
Lane, JD, CFP, MBA, CRPS
Category: Tax
Satisfied Customers: 10104
Experience:  Law Degree, specialization in Tax Law and Corporate Law, CFP and MBA, Providing Financial & Tax advice since 1986
1929974
Type Your Tax Question Here...
Lane is online now
A new question is answered every 9 seconds

We are a registered 501c3 with the state of CA. Under Public

Customer Question

We are a registered 501c3 with the state of CA. Under Public Charity Status is 509 (a) (2). What does that mean?
Submitted: 8 months ago.
Category: Tax
Expert:  Lane replied 8 months ago.

Hi - I can help you here.

...

For an organization to be excluded from private foundation status as an organization described in IRC 509(a)(2), it must normally receive more than one-third of its support from any combination of gifts, grants, contributions, membership fees, and gross receipts from permitted sources, and not more than one-third of its support from gross investment income and the excess of the amount of unrelated business taxable income over the amount of taxes imposed by IRC 511

...

Reg. 1.509(a)–3(a)(4) states that the one-third support test and the one-third gross investment and unrelated income test are designed to insure that an organization that is excluded from private foundation status under IRC 509(a)(2) is responsive to the general public rather than to a limited number of donors or other persons.

...

Both tests are to be computed on the basis of the nature of an organization’s normal sources of support.

...

In essence, your 501(c)(3) IS judged as responsive to the general public (a very good thing) .... and in line with the tax policy/logic that non-profits are not owned by individuals or small groups, but rather, by the public

Expert:  Lane replied 8 months ago.

I hope this has helped.

...

Please let me know if you have any questions at all.

...

If this HAS helped, and you DON’T have other questions … I'd really appreciate a positive rating (using the rating request, faces, or stars on your screen)

...

That's the only way I'll be credited for the work here.

...

Thank you!

Lane

I hold a JD (Juris Doctorate, a doctoral degree in the law), with concentration in Tax Law, Estate law & Corporate law, an MBA, with specialization in finance & tax, as well as CFP® and CRPS designations. - I’ve been providing financial, Social Security & Medicare, estate, corporate & tax advice since 1986.